Key Terms: Chapter 1 Flashcards
Financial Document?
A term given to a document which results from a financial
‘Cash Sale’
Where Payment is made straightaway
‘Credit Sale’
Payment is made at a later date.
Books of prime entry
The place in the books of a business where an FT is recorded for the first time.
Books of prime entry
3 x eg.
Day Books
Cash Book
Petty Cash Book
Financial Document
eg.
An Invoice
Day Books
A book of prime entry which lists the details of various FTs
Cash Book
Book of Prime entry which lists the details of various Financial Transactions
Financial Transactions
egs?
Sales
Sales Returns
Purchases
Purchases Returns
Petty Cash Book
Book of Prime entry which lists small cash business expense payments from an office cash fund
Small cash
(notes and coins)
Ledger Account
The formal accounting record
Often in DE format
For FTs involving customers & suppliers, business assets, expenses, income, liabilities & capital.
Double-Entry accounts
Ledger accounts set up on the DE system
ie. 2 entries, a debit and a credit, for each transaction
The Ledger
‘the book’ which contains the individual accounts, often subdivided into different categories
The Ledger (categories subdivided into?)
Sales ledger
Purchases Ledger
General Ledger
